South Korea trade body asks for exemption from U.S. auto tariffs

SEOUL (Reuters) - A South Korean trade group on Thursday asked the United States for exemption from a tariff on automobile imports for the Asian country, citing a security alliance and a bilateral trade deal.

A U.S. Customs sign is shown on a fenced area holing imported vehicles after arriving in the United States in National City, California, U.S. June 27, 2018. REUTERS/Mike Blake

U.S. President Donald Trump has threatened to impose tariffs on auto imports and foreign-made car parts after the Commerce Department finishes an investigation into the national security risks of those products.

A coalition representing major foreign automakers including Hyundai Motor Co (005380.KS) said on Wednesday the tariffs would harm automakers and U.S. consumers. Trump’s administration launched a probe in May into whether the imports pose a security threat and he has repeatedly threatened to impose tariffs.

“We are confident that Korea is not a source of threats that may impair U.S. national security, but rather a market of great export potential that meets the interests of the American auto industry,” Korea International Trade Association (KITA) said in comments it filed with the U.S. Department of Commerce.

KITA counts Hyundai, Kia Motors (000270.KS) and other makers of cars and auto parts as member companies.

KITA noted that South Korea and the United States in March had already agreed in principle to revise their bilateral trade deal, with Seoul saying it would improve local market access for U.S. automobiles and accept an extension on import tariffs for Korean pickup trucks for another 20 years.

“Unlike other automobile exporting countries or other foreign manufactures, Korea and Korean automakers have already addressed the concern of the U.S. counterparts,” it said.

KITA said the trade deal revision works to “ensure and maintain U.S. security interest in the region”.

South Korea, home to production facilities for Hyundai Motor and U.S. automaker General Motors (GM.N), is the fourth-biggest auto exporter to the United States after Mexico, Canada and Japan. Hyundai and Kia also have factories in the United States.

About 28,500 U.S. troops are stationed in South Korea, a legacy of the 1950-1953 Korean War that ended in an armistice rather than a peace treaty.